At a time when speculation is rife about consolidation in the Indian e-commerce industry, Myntra co-founder and CEO Mukesh Bansal tells Anand J & Sayan Chakraborty about his plans to acquire companies, launch a marketplace in a few weeks and why deep-pocketed players like Amazon pose little threat to Myntra’s growth. Leading a company that accounts for a fourth of the country’s $1-billion online fashion industry, Bansal says there is plenty of scope for everyone to grow. Excerpts:

Are there any signs of consolidation in the industry?

A lot of consolidation has happened in the last two years. I am sure there will be more mergers and acquisitions. We will also look at acquiring small companies that have either very strong technology or very strong fashion expertise. We are talking to a bunch of companies and will probably acquire one or two. M&As are sometimes useful, sometimes not. Companies have to make an informed choice.

What?s your take on reports of Myntra?s merger with Flipkart?

There has been a lot of speculation. We won’t comment on it.

What?s the latest on your funding plans?

Right now, the agenda is to scale very rapidly. At present, we are almost on a $200-million run rate and want to achieve $1-billion gross merchandise value (GMV) in two years. To get there, we will need another $100 million.

We are in talks with 10 investors to raise $100-150 million over the next 12 months. But we are not in a rush. There is plenty of scope to raise funds. Online retail is only 0.5% of the overall Indian retail landscape, which is set to grow to 10% in the next five years. I see a few billion dollars of investment over the next five years.

In which areas will you invest the funds you have raised recently?

We will spend mostly on building the Myntra brand, and on TV and offline media and digital marketing. Myntra will spend close to R150 crore on marketing. We will also expand our technical team from 100 to 200 engineers, besides augmenting the supply chain.

We will increase warehouse space from 100,000 sq ft to 400,000 sq ft. We are also scaling up logistics from 40 to 100 cities. We will also focus on personalisation on website, back-end systems and mobile. Now, we are drawing a fourth of our orders from mobile, up from 5% last year.

When do you think e-commerce players will start focusing on profitability?

I don’t think anybody is in a rush to increase profitability. We are at a stage where, if we want, we can become profitable. The scale has reached that level and margins are healthy. But we are investing in future growth.

It’s a poor strategy to focus only on profitability. Those who have given up scale and growth for profitability have perished. Scale is important because once you establish leadership in a category, you start getting better margins. A lot of other costs go down, such as marketing as part of revenue. It’s okay to invest half a billion dollars to build a $5-billion business.

What are you trying to achieve this quarter?

We will focus on marketplace expansion and new TV campaigns. Mobile will also be a big focus area. We will also launch our marketplace in the next few weeks, which, in the long run, is expected to account for a fifth of our business. We are also partnering close to 20 designers. We will open our designer corner in June or July.

How advantageous was the headstart over your competitors in the fashion space?

Fashion is a massive category, both online and offline. Being the first mover was definitely an advantage. But we have been able to position ourselves around fashion very strongly. Investments in technology, supply chain, everything taken together, have put us in a leading position in the space. We expect a lot of competition from other players. But the market is so big that there will be enough space for everyone.

What about competition from deep-pocketed players such as Amazon, or companies like Snapdeal?

We have been competing with them and we are still the leader. We are significantly bigger than anybody else in fashion. We are fully focused on fashion, on creating a better user experience and building better relationships with brands. Amazon is not a concern at all.